I would not file a 2021 Form 8606 showing an addition to basis since that would not get subtracted out on your 2025 tax return unless you file a 2025 Form 8606 that does this. TurboTax will not do this, so you would have to file on paper. Section 408(d)(5) already specifies that such a distribution is nontaxable, so no involvement of Form 8606 is needed.
